The Coate-Loury model is an economic framework that explores the relationship between education, income distribution, and externalities associated with human capital accumulation. Developed by researchers Stephen Coate and David Loury in the early 1990s, the model addresses how individuals' investments in education can lead to varying income levels and thus affect overall economic inequality in a society.

Artificial economics is an interdisciplinary field that combines concepts from economics, artificial intelligence (AI), and computational modeling. It involves the use of artificial agents, simulations, and computational techniques to analyze, model, and understand economic systems and behaviors. Here are some key aspects of artificial economics: 1. **Agent-Based Modeling**: This approach involves creating individual agents that interact according to defined behaviors and rules. These agents can represent consumers, businesses, institutions, or other economic entities.

A tax-benefit model is a mathematical or statistical framework used to analyze the relationship between taxation and the benefits provided by government programs, particularly in the context of social welfare and income redistribution. These models are typically employed by economists, policymakers, and researchers to evaluate how tax policies impact income distribution, poverty levels, and access to public goods and services.

Kuhn's theorem can refer to several concepts in different fields, but one of the most prominent is related to game theory and social choice theory, specifically "Kuhn's theorem" regarding extensive form games and backward induction. In the context of game theory, Kuhn's theorem states that in certain types of complete information games represented in extensive form, rational players will make choices that can be predicted based on the backward induction method.

Quantum economics is a relatively new interdisciplinary field that applies concepts and principles from quantum mechanics to economic theories and models. It seeks to understand economic phenomena using the frameworks and insights derived from quantum theory, which traditionally deals with the behavior of very small particles at the atomic and subatomic levels. The incorporation of quantum concepts aims to address limitations in classical economic theories that often assume rational behavior and deterministic outcomes.

The Ramsey problem is a foundational issue in the field of economics, particularly in the area of optimal growth theory. It is named after the British economist Frank P. Ramsey, who introduced the concept in his 1928 paper on intertemporal economic planning. In essence, the Ramsey problem involves determining the optimal way to allocate resources over time to maximize overall welfare or utility.

Strassen's algorithm is a divide-and-conquer algorithm for matrix multiplication, developed by Volker Strassen in 1969. It is notable for reducing the computational complexity of multiplying two \( n \times n \) matrices from the standard \( O(n^3) \) to approximately \( O(n^{2.81}) \).

Short-rate models are a class of mathematical models used in finance to describe the evolution of interest rates over time. In these models, the short rate, which is the interest rate for a very short period (often taken to be instantaneous), serves as the key variable. The models often aim to capture the dynamics of interest rates to assist in pricing fixed income securities, managing interest rate risk, and understanding the term structure of interest rates.

An Affine Term Structure Model (ATSM) is a class of models used in finance to describe the evolution of interest rates over time. The term structure of interest rates refers to the relationship between interest rates (or bond yields) and different maturities. The term "affine" refers to the mathematical form of the model, where the relationship is linear in parameters, making the analysis and computation more tractable.

Alpha profiling typically refers to a method used in various fields, including finance and trading, to analyze and evaluate the performance of investment strategies, particularly those that aim to generate "alpha." "Alpha" is a measure of an investment's performance on a risk-adjusted basis, representing the excess return that an investment generates compared to a benchmark index.

A bid-ask matrix is a tool used in trading and finance to represent the relationship between the bid prices (the prices buyers are willing to pay) and ask prices (the prices sellers are willing to accept) for a particular asset, such as stocks, currencies, or commodities. This matrix provides a visual way to understand the spread between the bid and ask prices across a range of quantities or orders. ### Components of a Bid-Ask Matrix 1.

The Carr–Madan formula is a method used in financial mathematics, specifically in the pricing of options and other derivatives. It provides a way to compute the price of an option by using Fourier transform techniques and is particularly useful for options with complex payoff structures. The formula relates the price of a European call or put option to the characteristic function of the underlying asset's log return distribution.

Cointegration is a statistical property of a collection of time series variables which indicates that, even though the individual series may be non-stationary (i.e., they have a stochastic trend and their statistical properties change over time), there exists a linear combination of those series that is stationary (i.e., its statistical properties do not change over time).

A correlation swap is a financial derivative that allows two parties to exchange cash flows based on the correlation between the prices of different underlying assets, typically equities or equity indices. In a correlation swap, one party pays a fixed correlation rate, while the other party pays a floating rate that is typically tied to the observed correlation between the returns of a specified set of assets over a predetermined period.

Discount points are a form of prepaid interest that borrowers can purchase to lower their mortgage interest rate. When a borrower pays discount points, they effectively pay a percentage of the loan amount upfront, which in turn can reduce the interest rate on the loan, leading to lower monthly mortgage payments. Here are some key aspects of discount points: 1. **Cost Structure**: One discount point typically costs 1% of the loan amount.

Girsanov's theorem is a fundamental result in the theory of stochastic processes, particularly in the field of stochastic calculus and quantitative finance. It provides a way to change the probability measure under which a stochastic process is defined, transforming it into another process that may have different characteristics. This is particularly useful in financial mathematics for pricing derivatives and in risk management. ### Key Concepts: 1. **Stochastic Processes**: A stochastic process is a collection of random variables indexed by time or space.

In finance, particularly in the context of options trading and derivatives, "Greeks" refer to a set of metrics used to measure the sensitivity of an option's price to changes in various underlying factors. Each Greek represents a different dimension of risk and can help traders understand how different variables can affect the value of options and other derivatives.

Emergency telephone numbers are special numbers designated for individuals to call in urgent situations that require immediate assistance, such as medical emergencies, fires, or crimes in progress. The numbers vary by country.

The International Association for Quantitative Finance (IAQF) is a professional organization dedicated to promoting the field of quantitative finance. Established to foster research, education, and the exchange of ideas among professionals and academics in this domain, the IAQF serves as a platform for networking and collaboration. Key activities of the IAQF may include hosting conferences, seminars, and workshops that cover various aspects of quantitative finance, such as risk management, analytics, financial modeling, and algorithmic trading.

The VIX, or Volatility Index, is a popular measure of market expectations of near-term volatility as implied by S&P 500 index option prices. Often referred to as the "fear gauge," the VIX reflects investors' sentiment regarding future volatility in the stock market.